CoreLogic: 2021 Refinance Closing Costs Remain at Less Than 1% of Loan Amounts
CoreLogic subsidiary ClosingCorp, San Diego, said national average closing costs for refinances increased by more than 4 percent in 2021, but remained less than 1 percent of the average refinance amount.
The company’s annual Refinance Closing Cost report found the national average closing costs for a single-family property refinance in 2021, excluding any type of recordation or other specialty tax, rose to $2,375. While this is up $88, or 3.8%, from 2020’s reported amount of $2,287, it is still less than 1% of the average refinance loan amount ($304,909).
By contrast, when CoreLogic issued its 2021 Purchase Closing Cost Report, it noted national closing costs average $3,860, excluding transfer and specialty taxes.
Bob Jennings, executive with CoreLogic Underwriting Solutions, said the major differences between average closing costs for refinances versus home purchases is that owner title insurance and several inspection fees common for purchase transactions are not typically required for refinances. Still, most third-party fees, including lender title, settlement service and land surveys, were also lower for refinances.
“In 2021, homeowners were still able to get good deals on both interest rates and closing costs,” Jennings said. “While refinance closing costs increased marginally, annual increases in fees still remain below the 7% average rate of inflation seen in 2021. Much of the cost control can be attributed to growing use of technology solutions by both lenders and settlement services providers, which enabled the industry to scale up capacity while holding the line on closing costs.”
The report said states with the highest average closing costs, excluding specialty taxes, were Hawaii ($4,730), New York ($4,679), Florida ($3,956), Texas ($3,588) and District of Columbia ($3,370). States with the highest closing costs, including taxes, were New York ($10,084), Pennsylvania ($7,614), Delaware ($7,223), Florida ($5,821) and California ($5,762).
At the metro level, those with the highest average fees without taxes include Key West, Fla. ($4,922); Arcadia, Fla. ($4,756) and Kahului-Wailuku-Lahaina, Hawaii ($4,651).